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Citigroup Trial May Double Enron Creditors' Payout

By Toby Lucich

Enron Corp. creditors could see their original payout more than quadruple to as much as $31 billion after a trial against Citigroup Inc.

Enron Creditors Recovery Corp., the entity winding up the defunct energy trader's affairs, distributed $13.3 billion, or 36 cents on the dollar, since a bankruptcy plan was approved in 2004. That includes most of $1.73 billion in out-of-court settlements with 10 of the 11 banks creditors accused of aiding the fraud that wiped out the company. They argue that Citigroup, the only lender that hasn't settled, should pay the rest of the claims, about $18 billion. The amount is more than six times the $2.8 billion reserve for Enron, WorldCom Inc. and initial public offering-related litigation that Citigroup disclosed in a Nov. 5 regulatory filing.

Citigroup Trial May Double Enron Creditors' Payout

Full post as published by inside Sarbanes Oxley on January 24, 2008 (boomark / email).